Pentagon and NSC underestimated Iran's resolve to close the Strait of Hormuz

The United States went into its military campaign against Iran without adequately accounting for the possibility that Iran would actually close the Strait of Hormuz. Multiple sources with direct knowledge of the planning process confirmed that both the Pentagon and the National Security Council significantly underestimated Iran's willingness to take that step in response to US and Israeli strikes. The closure is now a fact, and its economic consequences are moving faster than the administration anticipated.

Between 7 and 11 million barrels of oil per day have been removed from global markets since the strait was shut down. Crude prices are approaching $100 per barrel. For context, the International Energy Agency estimated in its 2024 World Energy Outlook that a sustained Hormuz closure of even 5 million barrels per day would be sufficient to trigger a global supply shock comparable to the 1973 Arab oil embargo. The current disruption is larger than that threshold.

What the intelligence and risk assessments actually said

Sources said agency-level analysis that warned of a high probability of Hormuz closure in the event of direct strikes on Iranian territory was sidelined during the planning process. The specific agencies whose assessments were deprioritized have not been named publicly, but the pattern described matches prior instances where interagency dissent was filtered before reaching senior decision-makers. The Defense Intelligence Agency and CIA both have dedicated Persian Gulf threat analysis units that routinely model Iranian responses to military pressure.

Iran had been explicit about the Hormuz option for years before the current conflict began. In 2018, then-IRGC commander Mohammad Ali Jafari said publicly that Iran would close the strait if its oil exports were blocked by sanctions. In 2019, Iranian officials repeated the threat during the maximum pressure campaign. The question was never whether Iran had the capability or stated intention. The question the NSC appears to have answered incorrectly was whether Iran would follow through when directly attacked.

How the strait closure actually works

The Strait of Hormuz is 21 miles wide at its narrowest point, with two shipping lanes each about two miles wide. Iran controls the northern coastline entirely and has military installations on Abu Musa and the Tunb islands, which sit in the middle of the strait. Closing it does not require a naval blockade in the traditional sense. Iran can use a combination of anti-ship missiles, mines, and threats to commercial shipping insurers to make passage commercially nonviable even without sinking ships.

That is what appears to have happened. Lloyd's of London and other major marine insurers suspended or dramatically increased war risk premiums for vessels transiting the strait within days of the closure announcement. When insurance becomes unavailable or prohibitively expensive, tanker operators stop sailing regardless of what the military situation on the water actually is. The economic effect of a closure is achieved well before any ship is actually hit.

Oil markets and the path to $100 per barrel

Crude was trading around $78 per barrel in early March 2026, before the conflict escalated. The move toward $100 represents a roughly 28 percent price increase in under two weeks. Goldman Sachs issued a note in the days after the closure projecting that Brent crude would reach $105 per barrel within 30 days if the strait remained closed, and $115 if the disruption extended beyond 60 days. Those projections assume no significant release from strategic petroleum reserves changes the supply picture materially.

The United States holds approximately 351 million barrels in its Strategic Petroleum Reserve as of early 2026, after significant drawdowns in 2022 that were only partially refilled. A coordinated IEA member release of 60 million barrels, which was the scale used in 2022 during the Russia-Ukraine disruption, would cover less than six days of the current Hormuz shortfall at the high end of the 11 million barrel estimate. Strategic reserve releases buy time. They do not substitute for the strait.

The planning failure and its consequences

When military planners build contingency scenarios, they typically assign probability weights to adversary responses and plan logistics around those weights. If the Hormuz closure was assessed as low probability and planned for accordingly, the supply chain response infrastructure, the diplomatic outreach to alternative suppliers, and the reserve release coordination would all have been sized for a scenario that did not materialize. That mismatch between planning assumptions and actual outcomes is what creates the kind of reactive scrambling that tends to follow intelligence failures.

Saudi Arabia and the UAE have some pipeline capacity that bypasses the strait. The East-West Pipeline in Saudi Arabia can carry approximately 5 million barrels per day to Red Sea terminals. Abu Dhabi's Habshan-Fujairah pipeline can move around 1.5 million barrels per day to the Gulf of Oman. Combined, those alternatives cover less than half of the lower bound of the current Hormuz shortfall, and both pipelines were already running near capacity before the closure. The arithmetic of alternative routing does not close the gap.